Description
NSE informs members that The Finance Act, 2026 has revised STT rates for options and futures transactions effective April 1, 2026, with significant increases on sale of options and futures in securities.
Summary
The Finance Act, 2026, which received Presidential assent on March 30, 2026, has revised the rates of Securities Transaction Tax (STT) on certain derivatives transactions. Effective April 1, 2026, STT rates on sale of options in securities and sale of futures in securities have been increased substantially. All trading members and their constituents are required to comply with the revised rates.
Key Points
- STT on sale of an option in securities increased from 0.10% to 0.15% (50% hike)
- STT on sale of an option in securities where option is exercised increased from 0.125% to 0.15% (20% hike)
- STT on sale of futures in securities increased from 0.02% to 0.05% (150% hike)
- Equity delivery transactions (purchase and sale) remain unchanged at 0.1% each
- Sale of equity shares/units settled otherwise than by delivery remains unchanged at 0.025%
- Sale of units of equity oriented fund on exchange remains unchanged at 0.001%
- Revised rates are mandated by The Finance Act, 2026 (Presidential assent: March 30, 2026)
Regulatory Changes
The Finance Act, 2026 has amended the STT schedule as follows:
| Transaction | Rate up to March 31, 2026 | Rate w.e.f. April 1, 2026 | Payable by |
|---|---|---|---|
| Purchase of equity share / business trust unit (delivery) | 0.1% | 0.1% (No Change) | Purchaser |
| Sale of equity share / business trust unit (delivery) | 0.1% | 0.1% (No Change) | Seller |
| Sale of equity oriented fund unit (delivery, on exchange) | 0.001% | 0.001% (No Change) | Seller |
| Sale of equity share / unit (non-delivery / intraday) | 0.025% | 0.025% (No Change) | Seller |
| Sale of an option in securities | 0.10% | 0.15% | Seller |
| Sale of an option in securities (exercised) | 0.125% | 0.15% | Purchaser |
| Sale of futures in securities | 0.02% | 0.05% | Seller |
This circular supersedes/continues from prior NSE circulars: Ref. No. 2/2016, 2/2018, 1/2019, 2/2019, 1/2020, 2/2023, and 2/2024.
Compliance Requirements
- All trading members of NSE must apply revised STT rates for transactions executed on or after April 1, 2026
- Members must ensure onward transmission of this information to their constituents (clients)
- STT must be collected and remitted at revised rates for options and futures trades from April 1, 2026 onwards
- For clarifications, members may contact Mr. Kunal Mehta or Mrs. Bhoomi Chitalia at taxation@nse.co.in or 022-26598140 / 022-26598100 Ext. 23059 / Extn. 22586
Important Dates
- March 30, 2026: The Finance Act, 2026 received Presidential assent
- March 31, 2026: Last day for old STT rates (options at 0.10%/0.125%, futures at 0.02%)
- April 1, 2026: Revised STT rates come into effect (options at 0.15%, futures at 0.05%)
Impact Assessment
This circular carries high impact for derivatives market participants:
- Options traders: The STT on option sale rises by 50% (from 0.10% to 0.15%), significantly increasing transaction costs, particularly for high-frequency options traders and market makers.
- Futures traders: The STT on futures sale nearly triples (from 0.02% to 0.05%), representing a 150% increase that will materially affect the cost of trading equity futures.
- Options exercise: STT on exercised options rises from 0.125% to 0.15%, increasing costs for options holders who exercise their contracts.
- Equity delivery investors: No change — long-term and delivery-based equity investors are unaffected.
- Intraday equity traders: No change — intraday (non-delivery) equity STT remains at 0.025%.
- The increased cost burden may reduce liquidity in options and futures markets and encourage reassessment of derivatives trading strategies by retail and institutional participants alike.
Impact Justification
Significant STT rate hikes on options (50% increase from 0.10% to 0.15%) and futures (150% increase from 0.02% to 0.05%) effective April 1, 2026 will directly increase transaction costs for all derivatives traders and members of the exchange.